Group: New Employment Act rules will burden businesses


PETALING JAYA: The government needs to assist business operators and employers and not burden them further, says the Federation of Malaysian Business Association (FMBA).

In opposing the amendments to the Employment Act that are scheduled to take effect on Sept 1, FMBA said it should be deferred by at least two more years.

“We call on the government to implement the right strategy at the right time as businesses need support right now instead of pressure to achieve our shared goal of economic recovery,” it said in a statement yesterday.

The FMBA said that due to the mounting challenges faced by businesses and the people, the implementation would further affect businesses which would then be felt by consumers as well.

“The enforcement of the amendments will cause increases in the prices of goods and services as employers will have to allocate more resources in hiring and paying workers.

“As such, despite the government’s various incentives, the cost of living will continue to go up,” it argued.

Amendments to the Employment Act include the reduction of the maximum working hours per week from 48 to 45, increases in maternity and paternity leave, the implementation of flexible working arrangements, and increased penalties for businesses that are found to have breached the Act.

Employers would also need to get direct approval before hiring foreign workers, and they must inform the authorities of any termination within 30 days.

The FMBA urged the government to take into consideration the views of all industry players, especially micro businesses, during discussions.

It added that any future amendments should be more practical based on the industries affected.

“There has to be at least a two-year cooling off period from the proposed date of the enforcement to give businesses time to adapt,” FMBA said, adding that the new provisions should not apply to employees with salaries above RM3,000.

It said the government should focus on solving pressing issues faced by industries first.

“The government needs to focus on solving the current lack of workers in sectors that are heavily affected by Covid-19, as well as human resource issues due to misunderstandings of the amendments to the Act among all parties,” said the FMBA.

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